Tag: asset prices

CBRE: Madrid Is EMEA’s 3rd Most Attractive City For RE Investors

30 March 2017 – Mis Oficinas

Madrid is the third most attractive city in Europe, the Middle East and Africa (the EMEA region) for real estate investment. At least that is according to the “Global Investors Intentions 2017” report compiled by CBRE, the leading real estate consultancy and services company in the world, based on a survey of 2,000 international investors.

According to the study, London leads the ranking of the most attractive cities for real estate investment, after it was chosen by 17% of investors. It was followed by Berlin (15.8%) and Madrid (8.4%). Amsterdam and Paris complete the top five (…). For the first time in 2017, cities such as Hamburg and Milan did not appear in the top ten, due to growing concerns from investors about (high) asset prices in some of Europe’s most established markets, following years of increases.

“Madrid is a very attractive city for international investors for a variety of reasons. Prices here are still below those of other markets, and in recent years, some very interesting renovation and development projects have been launched. Similarly, rental income is forecast to rise. These factors caused investment in the Spanish capital to exceed €4,000 million in 2016”, said Paloma Relinque, National Director of Capital Markets at CBRE Spain.

Meanwhile, Spain is ranked sixth in the list of the most attractive countries to invest in, whereby maintaining its top-10 position, against competition from all of the countries in Europe, the Middle East and Africa. In this sense, Germany is the market of choice for 22% of those surveyed as an investment market in 2017. It is followed by the United Kingdom (20%), Eastern Europe (10%), Scandinavia (10%) and The Netherlands (9%).

In terms of the sectors that these investors plan to invest in, the office market was mentioned the most, by 34.7% of investors. It was followed by the industrial-logistics sector, chosen by 25.9% of respondents. Nevertheless, one of the most interesting conclusions was the growing appetite for alternative assets, in which 7 out of every 10 real estate investors are now investing. Specifically, real estate debt is the segment that is sparking the most interest amongst investors (31%), followed by leisure and entertainment (27%) – which is the segment that grew by the most in comparison to the previous year – and student halls of residence (25%).

On the other hand, the report described investors’ main concerns for 2017. The most frequently mentioned concern was the risk that interest rates rise more quickly than expected, a fear cited by a quarter of the investors surveyed. It is noteworthy that, despite the numerous elections on the horizon in Europe and their possible implications for the sector, investors place greater importance on the economic climate than on geopolitical matters. The third concern is the fact that prices are forecast to increase and the risk of a possible bubble. (…).

Original story: Mis Oficinas

Translation: Carmel Drake

Aguirre Newman: 2016 Is Going To Be A Good Year For RE

26 February 2016 – El Economista

According to the President of the real estate consultancy Aguirre Newman, Santiago Aguirre Gil de Biedma, the real estate sector is going to continue to see an “extraordinary” level of activity in 2016, thanks to the significant interest from investors.

In a presentation at the 2nd Meeting of the Real Estate Sector, organised by the business school IESE, Aguirre was optimistic about the year ahead: “we are continuing to see very significant interest” from investors.

Nevertheless, he lamented the possible effects of the on-going political uncertainty. “We should be worried if we look at what has happened to our friends in Portgual”, he said, although he qualified that by saying that “it will not be easy to undo the reforms approved over the last four years because that would require consensus”.

“These reforms have given us stability and confidence in the markets, which will continue for the next few years”, he said. In any case, Aguirre expects the panorama in his sector during the second half of the year to be “much clearer than it is now”.

A new sense of normality in the real estate sector

Meanwhile, the CEO of the appraisal company Tinsa, Ignacio Martos, confirmed that we are experiencing a new sense of normality in the real estate sector. “The increase in prices during 2015 was consistent. We are facing a scenario in which asset prices are very good and it is likely that they will continue to increase”, he said.

In terms of the near future, Martos advised investors to “not gamble too much” to “take the right decisions” in a market that is going to be characterised by caution.

When asked about the trend in the sector, Martos said that speculation and large price movements “are now a thing of the past” and he agreed with Aguirre that the market “is in a good position” and “there are going to be lots of opportunities”.

Original story: El Economista

Translation: Carmel Drake